Divi's Laboratories Ltd. reported a 29% year-on-year drop in net profit for the third quarter, falling to Rs 348 crore ($46.5 million) from a higher figure last year, according to the company's recent financial disclosures. This also marks a 2.2% quarter-on-quarter decrease from Rs 356 crore.
However, the firm saw a modest rise in its operations revenue, which grew 3% YoY to Rs 1,909 crore. The total income for the period also increased, reaching Rs 1,995 crore.
The company's forex gain for the quarter was Rs 11 crore, a significant reduction from last year's Rs 31 crore. The pre-tax profit stood at Rs 469 crore.
For the first half of fiscal year 2023-24, Divi's Laboratories' net profit fell sharply by 41.13% to Rs 704 crore. The forex gain for this period was recorded at Rs 14 crore.
In September, a high-level delegation from the US Food and Drug Administration (FDA) visited Divi's facilities in Hyderabad. The visit focused on discussions regarding the integration of new technologies and upgrades to manufacturing processes.
As of Monday, Divi's shares were trading with a slight increase of 0.75% on BSE at Rs 3,375 each.
InvestingPro Insights
In light of the recent financial results from Divi's Laboratories, it's important to consider some key metrics and insights from InvestingPro.
Firstly, the company's stock is currently regarded as being in oversold territory according to the Relative Strength Index (RSI), an InvestingPro Tip that suggests the stock may be undervalued. This could present a potential buying opportunity for investors looking for a bargain.
Secondly, Divi's Laboratories has shown a solid track record of maintaining dividend payments for 21 consecutive years, which is an encouraging sign for income-focused investors. This is supported by data showing a dividend yield of 2.15% as of the end of 2023.
Lastly, despite the recent decline in net profit, the company's revenue has been growing. However, it is worth noting that the stock trades at a high earnings multiple, which may indicate a premium valuation.
For more comprehensive data and insights, consider exploring InvestingPro's product, which includes over 15 additional tips specifically for Divi's Laboratories.
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